Understanding business law is essential when establishing a business because it is only by so doing that one can run various activities within the business without any hindrances. Additionally, conceptualization of the law enables one to acquire knowledge as to how to run different kinds of businesses. For instance, partnerships, sole proprietorships, and companies are various types of businesses, with each having a different set of laws to govern it. Also, business rules ensure that an individual understands the various requirements required in order for one to set up and run a business. To get permission to operate a business in any given area, one must pay for licenses. The law is of the essence to the ownership of, and also to the creation of proper structures for the understanding of the legal documents required in order for a particular business to be operationalized. When a person has adequate information regarding business law, he is able to avoid mistakes and difficulties that result from an ignorance of the same. It is important to seek guidance and directions from experts to learn about business legislation that will affect the business.
In the case State Farm Fire and Casualty Co. v. U.S. ex rel. Rigsby, Rigsby sued the State Farm Fire based on the belief that the State Farm was out to maximize flood damage claims and minimize the claims from wind damage for its policyholders after the Hurricane Katrina. This was after an incentive to all insurance companies to change their policies so as to classify losses as either caused by wind or flood. A policy will cover the wind, but not flood damage and vice versa; the government funds would pay for damages caused by flood while the companies were responsible for wind damage. However, the State Farm appealed the case arguing that Rigsby had acted against the seal requirement as stipulated under the False Claims Act (FCA) which warranted for immediate dismissal of the case. Although by disclosing the existence of the suit Rigsby violated the seal requirement, the court stated that this violation did not mandate dismissal of complaints. According to the Court of Appeals in the United States, the purpose of the seal requirement is to protect the interest of the government and not to undermine it through rigid interpretation.
Delegate your assignment to our experts and they will do the rest.
The respondents in this case, Cori and Kerri Rigsby, claimed that State Farm had asked them and other claims adjusters to classify wind damages and flood damages. This was to enable the Farm to transfer the insurance liabilities to the government which paid for the flood damages. Under the FCA, violating the seal requirement complaints filed in the camera as to be kept private for 60 days and should not be served without a court order to the defendant. This was the basis for seeking dismissal of the case by the State Farm arguing that the pending suit was disclosed to news sources by the respondents’ attorney. Despite the efforts of the petitioner to dismiss the case under violation of the seal requirement, the government lifted the seal in part and allowed the disclosure of the action to the court. The court affirmed its decision against the dismissal of the suit stating that the lack of a remedy for violation of the seal argument in the statute did not qualify dismissing the case as the solution.
Business law is a structure composed of municipal, state and federal laws that make sure that business activities are governed in a manner that promotes fairness and just competition. On the other hand, the fundamental role of judicial concepts is to ensure that businesses are conducted fairly and that justice is maintained. Some judicial concepts that influence the decision in business include judicial independence, the rule of law and judicial neutrality. Judicial independence is the idea that the court should not be subjected to external influence from private interests or the government. The rule of law is based on the fact that no one is above the law and that the rules established should follow the truth and legitimately exercised to all people. Judicial neutrality requires that everybody is treated equally and that judges should be free of any form of bias. These concepts play a significant role in decisions made by judges on cases in the business environment.
The court made a unanimous decision in the case State Farm Fire and Casualty Co. v. U.S. ex rel. Rigsby. According to the court, while factors indicate that it was appropriate for case dismissal due to a violation of the seal argument, the decision should be made by the district court. Even though there was a violation of the seal, not all cases are mandated to be dismissed on such grounds. Moreover, the State Farm, which was the petitioner did not request for any other sanction apart from dismissal. Essentially, the seal requirement is intended to protect the government; however, this interpretation should not be rigid to serve individual interests of the parties involved in a case. In this case, the State Farm Fire had broken the law by instructing the claims adjusters to misclassify wind damages as flood damages. Therefore, I agree with the court’s decision of denying the State Farm, its request for case dismissal on a seal violation basis. While it is still of the essence to recognize that the respondents went against the law in disclosing the suit before the required time, the bigger picture is business ethics and following the business law by the insurance company. This should be the primary focus of the court, to serve justice for the government and Rigsby and other adjusters.
